Laminate flooring companies have come and gone since the category entered the market in the mid-1990s, but one of the first players, Wilsonart, is still a category fixture. The manufacturer still utilizes a high-pressure process,which offers performance advantages over the competition, but with it comes a premium price. Over the last 12 years, the company has been faced with a host of challenges, not the least of which has been increased competition from new shooters of varying quality.

Most recent was the announcement that parent company Illinois Tool Works had put Wilsonart International up for sale. FCNews associate publisher and editorial director Steven Feldman recently sat down with Russ Rogg, who is now leading the flooring division, to discuss the current state of affairs.

How is Wilsonart structured today in the aftermath of some key departures in the last 12 months?

Curt Thompson had oversight of the business, and Rob Tarver handled our national accounts. With their departures, I have assumed many of the roles Curt had, as well as becoming the direct contact with the buying groups. So I have assumed components of both roles. With that, we promoted Mark Kieckhafer to national sales manager with oversight of the sales force and liaison with our distributor partners. Tammy Weadock continues to manage all marketing communications, while Natalia Smith continues to lead our product design initiatives. In essence, we are still the same young, talented group. The flooring organization has rejoined the larger Wilsonart organization with oversight by Bill DiGaetano, president.

How does your management style differ from that of your predecessors?

I am more inclined to take into consideration a wide range of inputs—from our retail partners, distributor partners and from those who can add value internally—and develop a game plan that is multi-faceted, a plan built on consensus. I feel programs are more easily enacted if everyone feels they have a stake. As we move forward, much of our programming is influenced by external research conducted among some of our best retailers throughout the country.

As a manufacturer that focuses on the upper end of the market, are you finding things tougher than most?

Clearly the economic downturn has impacted everyone in the flooring industry, not the least of whom is the independent flooring retailer, which represents the core of our business. With money being tight, it is even more challenging to be operating at the high end of the spectrum. However, going forward, we believe consumers will be more focused than ever on high value for their investment, which is where the Wilsonart high-pressure laminate story really delivers. Retailers who understand how to focus on the higher value of HPL, as well as its benefits versus other high-end flooring options, will continue to do very well with Wilsonart Flooring. And, they’ll earn higher return on an already limited number of transactions.

Are you finding some price points getting hit harder than others, for example, Red Label vs. Estate Plus or Styles?

We offer products that can be purchased by the consumer from $3.49 to $6.99 a square foot, product only, and 60% of our business will be achieved between $3.99 and $4.99. Admittedly there is more competition at our entry-level price point; however, our growth has come at the mid to upper end. For us, the competition at the higher end comes from alternative products like hardwood and luxury vinyl, against which we think we have distinct competitive and performance advantages.

Are you finding any areas of the country doing better than others?

We would point to the Pacific Northwest as our best-performing area over the last 12 to 18 months. In part, that is because the Cronin Co., which is a full-line Wilsonart distributor that sells everything we produce— solid surfacing, adhesives, countertops, flooring, etc. It allows them to create brand awareness for Wilsonart products in a bundled fashion. A lot of their growth is fueled through a greater mix of commercial business with Wilsonart. When residential slowed, they did an outstanding job of filling that void by promoting our products in commercial environments. Also, around mid-year 2008 we went single distribution in the majority of that territory; Cronin made investments and was aggressive in selling the Wilsonart advantage.

What are some of the things you are doing this year to weather the storm?

We have addressed everything you would expect from any business during this challenging time: personnel, manufacturing, spending, etc. Now we are leveraging some of the advantages that the larger Wilsonart organization has, such as logistics. For the last 12 years, we have shipped only flooring goods on trucks headed to our distributor network. Now we are formulating a bundled shipping program that would allow flooring goods, adhesives, solid surfacing, etc., to be grouped together on a shipment to get to a particular destination quicker and with lower costs. That helps our distributors in that they will not have to order in full-truck increments. I envision getting smaller, more frequent orders from our distribution network.

Where are you focusing your efforts this year?

We realize that an important key to success for independent retailers is their ability to service residential and commercial business through their stores. Because Wilsonart Flooring is rated for both residential and commercial installations, we will converge what has been up until now a separate approach to our residential and commercial business by bringing them together at point of sale. This will occur with the introduction of a Main Street commercial product that will be branded Professional Studio sold through the retail channel. We are currently launching it with our Synergy dealer network. We think this strategy can help our retail partners diversify into a segment in which few are participating today: projects like local restaurants, doctor’s offices, hair salons, boutiques, etc. Also, merchandising a commercial product from Wilsonart at retail lends additional credibility to the balance of our portfolio for consumers seeking durable, high-performing floors.

What’s going on in the commercial arena?

Today’s it’s about 20% of our business. Phase I was to launch to the A&D community and selling those goods through commercial contractors. The evolution is to leverage those relationships and retail relationships by taking a portion of that line and making it available under the Professional Studio brand. There is still a lack of awareness on the part of the specifying community relative to the appropriateness of laminate in commercial environments as well as misinformation and misunderstanding of the performance characteristics and qualities of laminate flooring. In some instances, a bad experience with the low-pressure products has hurt the category a bit. The primary way we are reaching that audience today is through a specification sales force that represents all products Wilsonart produces, including flooring. We have approximately 40 such representatives strategically positioned throughout the country. They call on the A&D community, make box lunch presentations and participate in professional associations like ASID. It’s more of a grass roots awareness campaign as opposed to a mass marketing approach.

Most of your distributors carry multiple laminate brands. How does this impact your business?

We have what I believe to be the industry’s best distributor network. That can be a double-edged sword in that if they represent other laminate brands, by the sheer nature of their credibility as their distributor, they strengthen those alternative brands. By the same token, Wilsonart Flooring is not like any other laminate flooring that they may carry. And we are focusing on building that differentiation story—the high-pressure laminate story—strongly in the minds of both our distributors and our retailers. In fact, we are in the process now of launching a nationwide training initiative designed to completely educate our trade audience on the important differences HPL brings to the table.

Talk a little about the fact that your parent company has put Wilsonart on the block. How has it impacted business? Do you get asked about it?

Wilsonart Flooring is part of a much larger organization that our parent has decided to sell. The fact that we are for sale only impacts us to the extent that we are being smarter and more efficient about how we run our business. To our customers, the difference should only be noticeable in the improvements we’re making.

One thing we often hear is that the process by which Wilsonart laminate flooring is made is not cost efficient. Some have even called the technology antiquated.

On the cost side of the equation, a high-pressure laminate floor costs more to produce than a direct pressure floor. The advantage we have is that we are the low-cost producer of high-pressure decorative laminate. So based on our scale, if anyone was going to be in the high-pressure game, it’s a natural for us to be there. Our technology, both in terms of making the laminate and the laminate flooring, is unique and proprietary to Wilsonart International. As a company, we are industry leaders in innovation. Our vertically integrated process is an advantage and not a limiting factor as evidenced by the advancements we have made in the past two years with new product development.

Is it true high-pressure laminate does not allow for the same level of aesthetics as direct pressure?

I feel very strongly about the power of our style and design capabilities. SKU for SKU, I think we have the best design diversity as any manufacturer in the industry. The issue I see is that while we have gone to great lengths to deliver meaningful new products to the market in the last 24 months, we have not been widely recognized for our successes. As an example, the Styles category, which first launched in spring 2007, is now one of our top-selling collections. Today we offer over 100 designs and eight textured finish options. We see no evidence that HPL is a limiting factor in significant design development.

What do you offer that your competition may not?

1. We are, in essence, the only provider of a high-pressure laminate flooring product made in North America. HPL still provides performance properties, primarily impact resistance, that is unparalleled by direct-pressure or low-pressure alternatives.

2. We continue to support the independent retail channel only and do not participate in the home center channel.

3. We believe we offer the most viable laminate product that allows our retailers to diversify into the commercial segment.

How much does having a recognized brand impact the business?

The Wilsonart brand is synonymous with the category in which we are participating. And we are the leading producer of high-pressure decorative laminate in North America. For our category, it is as recognizable as any laminate brand out there. It can be used as a closing tool.

What are your marketing plans for 2009, both to the retailer and consumer?

Our emphasis is on our new product launch, bringing Professional Studio into the retail channel, introducing a new rectangular tile format and mobilizing our sales managers and distributor reps to get back in the trenches and revisit what has historically been one of our best weapons: education. Simultaneously, we are working on our sustainability program to communicate more effectively what we do as a company as well as the inherent environmental benefits of the products we manufacture.